There is a bed on Asklipiou Street, in the center of Athens, and it is oddly clean. Throughout the day, Christos, who claims the bed, obsessively picks up the litter left nearby by pedestrians, while quietly talking to himself.

“He’s one of the many mentally ill people that are now living on the streets of Athens,” says Thodoris Megaloikonomou, a physician at the Psychiatric Hospital of Attica (Dafni), on the periphery of Athens “In the past, you wouldn’t see so many. There’s a huge increase – now, they’re everywhere.”

Two years of austerity cuts have brought Greece's state-run health care system to its knees, and the mental health sector is among the hardest hit. Twenty-five years of progress in the system are in jeopardy and staff shortages and facility closures have left many of Greece's mentally ill stranded on the streets, doctors say. Many of the mentally ill are there because their families can’t afford to help them anymore.

The social welfare system that existed in Greece prior to the economic crisis wasn't comparable to those in Sweden or Norway, but whatever there was before is now falling apart.

Until the early 1990s, Greece's psychiatric wards were commonly overcrowded. Thousands of patients lived as outcasts, locked away from society in psychiatric hospitals. The situation at the asylum on Leros Island – where inpatients suffered inhumane conditions, walking around naked and getting bathed in large groups with a hose – garnered international attention in 1989, finally spurring the European Union to send financial support, after which the system made substantial strides forward.

But when the European debt crisis erupted in 2009, some of the reforms, namely deinstitutionalization, were not finished. After three decades of housing the mentally ill in hospitals, the plan was for patients to be moved either to smaller shelters or boarding homes or back to their own homes with the intent of reintegrating them into society. They were slated to receive care through nearby mental health centers, some of them homes where the patients lived, others outpatient facilities where patients just stopped in. The facilities, created so that only people suffering emergency and very serious cases of mental illness had to live in hospitals, were financed by the EU until 2007, after which the Greek government had agreed to take over the funding.

“The problem is that despite the 25 years of financing from the EU, there was never a plan by the Greek state on how to carry on with the reform,” says Mr. Megaloikonomou. “Deinstitutionalization never happened. There was only trans-institutionalization: patients were sent from big institutions to smaller ones. So, chronic patients were taken from psychiatric hospitals to centers that were often using similar methods.”

The mental health centers are now facing a 55 percent cut to their national budget – from 2011 to 2012, or 85 million euros to 40 million euros – as well as delays in payments and some have been forced to shut down. The overall health care budget is 25 percent lower today than it was in 2009.

“We still haven’t received the whole budget the ministry assigned to us for 2011,” said Eleni Tsigara, president of EPSAMY, one of the mental health homes in Athens. “The only way to continue was to reach a settlement with the electricity company and social security office.”

EKEPSYE, a home in Athens that closed last September, housed eight patients. Three of them were sent back to Dafni Hospital, even though they didn’t require hospitalization.

“These patients were in Leros during the 1970s, they then were transferred to Dafni Hospital, then with the reform they were sent to the shelter EKEPSYE and now they’re almost back where they started, in Dafni Hospital,” says Megaloikonomou. “Two of them were sent to the geriatric section, where conditions were similar to Leros.”

Doctors predict that the financial strain on the centers will only get worse, further decreasing patient access and causing problems to spill over into the hospitals.

“Insufficient care for the mentally ill means the number of non-voluntary admissions in psychiatric hospitals will rise,” says Panettas. “In times of crisis, poor families are having problems taking care of their mentally ill [relations]. These people either end up in the streets or in the hospital.”

While the number of admissions to Greece's psychiatric hospitals is rising, the hospitals are facing shortages because of budget cuts and a freeze on public sector hiring. Christos Panettas, deputy director of Dafni, says the hospital only has one-third of its staff left and it doesn't have enough supplies or medicine. "The hospital sometimes is short on toilet paper," he says.

Another pressing issue is uninsured patients, increasingly common because of widespread unemployment. Doctors say they sometimes keep uninsured patients in the hospital to ensure they have access to medicine and a bed, but things can easily get complicated.

“A man was admitted in our hospital because he tried to commit suicide due to the financial problems he was facing,” says Megaloikonomou. “We tried to help him but when he was about to leave the hospital, they asked him to pay 3,000 euros. You can imagine how he felt.”

The Ministry of Health is trying to find more reliable revenue for the mental health centers. At the beginning of this month, the Greek parliament voted on a new law that forces the institutions to take a percentage from their benefits or pensions.

“In the beginning, funding came only from the state and from the patients’ health insurance," Megaloikonomou said. “Now they’re going to take money from the patients’ pension. This violates their human rights.”